Ayala net profit up 16%; energy units consolidated

DIVERSIFIED conglomerate Ayala Corp. grew its first quarter net profit by 16 percent year-on-year to P2.45 billion on the back of robust real estate and banking and water businesses, the turnaround of its telecom unit and healthy core earnings in water distribution.

The Ayalas, which recently ventured into wind, solar and mini-hydro power interests, is also consolidating energy-related assets in a single platform called AC Energy Holdings Inc., which will have a P1-billion capitalization.

In a report yesterday, Ayala said its real estate, banking, telecom and water units accounted for the bulk of equity earnings.

“We are pleased with the growth momentum of the majority of our domestic businesses,” Ayala president and chief operating officer Fernando Zobel de Ayala said in a press statement.

Property unit Ayala Land grew its first quarter net profit by 36 percent to P1.6 billion driven by robust residential and higher commercial leasing revenues. Bank of the Philippine Islands also increased its first-quarter net income by 4 percent to P2.9 billion. Globe Telecom sustained its turnaround and posted record quarterly revenues of P16.5 billion in the first quarter, 8-percent higher year-on-year.

Manila Water’s net income declined 3 percent to P816 million largely as a result of mark-to-market losses realized on its bond. Excluding this, core income was up 14 percent to P1.2 billion.

Ayala Automotive’s net income fell 63 percent due to lower vehicle sales of its Honda dealerships, which declined by 27 percent. Its Isuzu dealerships recorded a 4-percent growth in sales. Business process outsourcing LiveIt recorded an operating net income of $600,000 against an operating net loss of $3.1 million in the same period last year.

Offshore unit AG Holdings also reversed losses incurred in the same period last year and reported a net income of P258 million in the first quarter.

Ayala ended the quarter with cash of nearly P28 billion.

The conglomerate also announced that the board and stockholders of its 100-percent owned subsidiary Michigan Power Inc. (MPI) had voted to amend the company’s bylaws to change its name to AC Energy and to increase the authorized capital stock to P1 billion from P10 million. Doris C. Dumlao